A merchandising coupon is often referred to as a “cents-off” or discount coupon or alternatively a promotional coupon. The holder of the coupon, when purchasing the product identified on the coupon from the retailer, is given a specified discount or other promotional benefit. Such coupons fall into two basic classes those printed and put into distribution by manufacturers, and those which retailers print for use in their stores.
The majority of merchandising coupons are authorized by the manufacturer of the product so that the manufacturer is required to pay to the retailer the face value of each coupon redeemed, plus certain handling charges. For example, on occasion the Coca-Cola Company runs ads which include a coupon offering 25 cents towards the purchase of a pack of “Coca-Cola” bottles. The retailer who accepts this coupon gives the purchaser of the pack a 25 cent reduction on the market price thereof. The retailer is then entitled to recover from the Coca-Cola Company this 25 cent discount, plus seven cents for handling costs (or whatever other handling charge is indicated).
Despite the high cost of merchandising coupon transactions, the volume of coupon traffic has risen over the years to a phenomenal level. Though only a fraction of the many billions of coupons which are distributed are actually put to use by shoppers, the number of coupons which are redeemed still runs into the billions.
Experience has shown that cents-off coupons and promotional coupons constitute a cost-effective promotional technique for stimulating consumers to try out a new product or to switch brands. Moreover, when sales of a given brand are flagging, merchandising coupons often serve to revive and even increase such sales. Merchandising coupons therefore benefit the consumer, the manufacturer and the retailer.
While in some instances coupons accepted by the retainer are redeemed by sending them directly back to the company making the product most coupons first go through a clearing house where, after the coupons have been manually sorted, they are shipped by the clearing house to the respective manufacturers who then invoice the money payable to the clearing house.
With existing procedures, the manufacturer has little control over the number or value of coupons redeemed. By statistical analysis of previous coupon promotions, the manufacturer can make a projection of anticipated redemptions. However, if a coupon was issued for a larger than usual discount and the redemption rate was higher than expected, the manufacturer may then incur a greater promotional expense than projected.
Also, with the existing procedures, the time elapsing between issuance and redemption of a coupon can be many months, particularly if the coupon carries an expiration date which gives the shopper a long term in which to use the coupon. This makes planning for future promotions difficult, for information on coupon redemptions in previous promotions is slow to arrive.
Quite distinct from these problems is the failure of many shoppers to take advantage of merchandising coupons. While a shopper may save coupons mailed to him or her or may clip and file coupons appearing in newspapers and magazines, the shopper often forgets to take them along when going shopping and therefore will not be induced to make a discretionary purchase or switch brands. Typically, a consumer will receive in the mail a merchandising coupon, say, for a new hair shampoo; but it will be several days before the next shopping trip, and by that time the shopper may have forgotten about the coupon and will therefore purchase the usual brand.
U.S. Pat. No. 5,176,224 issued to Donald Spector on Jan. 1, 1993, the inventor of the instant application, proposed one unique solution to the foregoing coupon distribution problem. In this patent, Mr. Spector proposed a controlled-loop computer-controlled merchandising coupon system where a coupon printer-dispenser would be installed at each supermarket, making it possible for a shopper to receive a merchandising coupon entitling him or her to a specified discount on the product identified in the coupon. Advantageously, this patent also disclosed that the manufacturer would be provided with a readout of the discount coupon transactions so that the manufacturer could subsequently alter the discount amount on the basis of the coupons being presented by the consumer.
Another coupon distribution system is described in U.S. Pat. No. 5,249,044, issued to Harry Von Kohorn on Sep. 28, 1993. This patent describes a system for generating product coupons at remote locations, including a consumer's home. The system, includes an apparatus for receiving and storing product information signals broadcast from a central television broadcast location. The apparatus is connected to a consumer's television at a remote location, which television includes a coupon generating unit. When the consumer views a product of interest, the system can be activated, and if available the consumer can have a discount coupon printed at his or her home for later presentation to a retail outlet. The possibility to receive a coupon at home was an advance in the art but still did not give the manufacturer the ability to monitor coupon distribution and tailor such distribution to enhance particular product sales. Other similar patents in this area include U.S. Pat. Nos. 5,500,681 and 5,978,013. The teachings of the '044, '681 and '013 patents are incorporated herein by reference.
A further improvement is disclosed in U.S. Pat. No. 5,287,181. In this system, coupon related data is encoded in a television signal transmission, which data is decoded and displayed on the television screen. Upon viewing the indicia on the television screen, the user can manually and selectively extract the coupon-related data from the television signal transmission. After an optional editing function, the extracted coupon-related data is stored on a recording medium such as a magnetically striped card, for subsequent readout and redemption. This system also envisions that consumer information would be provided to the manufacturer, upon redemption of the coupons. In this embodiment the manufacturer would be able to determine results in the amount of usage of the coupons, the demographics of usage and detailed information about the consumer.
This system however, does not show or suggest a method or apparatus with which a manufacturer could make decisions regarding coupon usage on a real time basis and tailor coupon issuance accordingly.
An additional problem with the prior art coupon delivery systems via television is the recent introduction of Personal Video Recorders (PVR) which consist of a set-top box equipped with a large capacity hard drive. Incoming television signals are digitalized and stored on the hard drive, allowing the consumer to view replays, catch-up on shows already in progress, index and select recorded shows and most importantly, eliminate commercial advertisements. The ability of a consumer to eliminate commercials is a major problem for manufacturers due to the large amounts of money currently spent by manufacturers on advertising, and the possibility that those ads will not be watched by consumers.
It is therefore one object of this invention to provide an incentive for consumers equipped with PVR's to view commercials by offering product discount coupons tied to a specific commercial.
It is a further object of this invention to provide instant coupon feedback information to a manufacturer regarding their coupon discount program.
It is a still further object of this invention to provide coupon feedback information to a manufacturer before the coupon is issued for redemption.
It is another object of this invention to allow a manufacturer to tailor it's coupon discount program in real time based on point-of-sale information, thereby allowing manufacturers to maximize profits and sales.